decision making process in consumer purchasing behavior

DECISION MAKING PROCESS IN CONSUMER PURCHASING BEHAVIOR: A CASE STUDY AT TESCO PERINGGIT JAYA AND AEON BANDARAYA MELAKA

WAN NURULASIAH BINTI WAN MUSTAPA

UNIVERSITI TEKNIKAL MALAYSIA MELAKA

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PENGESAHAN PENYELIA

“Saya/Kami‟ akui bahawa telah membaca karya ini dan pada pandangan saya/kami” karya ini adalah memadai dari segi skop dan kualiti untuk tujuan penganugerahan Ijazah

Sarjana Muda Pemasaran Teknologi Tinggi (Kepujian)

Tandatangan : ………………………

Nama Penyelia : En. Mukhiffun bin Mukapit

Tarikh : ………………………


Nama Penilai : Dr. Norain binti Ismail

Tarikh : ………………………

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Decision Making Process in Consumer Purchasing Behaviours

Submitted By:

Wan Nurulasiah Binti Wan Mustapa

This report is submitted to

Faculty of Technology Management and Technopreneurship (FPTT)

Universiti Teknikal Malaysia Melaka In partial fulfillment for Bachelor of Technology Marketing Management (Hons.)

Faculty of Technology Management and Technopreneurship (FPTT),

Universiti Teknikal Malaysia Melaka June 2015

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PENGAKUAN

“Saya akui laporan ini adalah hasil kerja saya sendiri kecuali ringkasan dan petikan yang tiap-tiap satunya saya telah jelaskan sumbernya”


Nama Pelajar : Wan Nurulasiah Binti Wan Mustapa

Tarikh : ………………………

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DEDICATION

For my dearest father and mother,

And for my sister and supervisor who always support me

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ACKNOWLEDGEMENT

In the name of Allah, the Most gracious, the Most merciful.

All praise to Allah for the completion of this report as it is with His grace that

I was able to complete this report efficiently within the time limit. I would like to

express my deepest gratitude and heartfelt thanks to my parents and my family as it

is with their strong support that I am able to complete this report. They had supported

me in many ways morally and also in material.

Special thanks to En. Mukhifffun bin Mukapit for being very supportive and also for his care, guidance and attention towards me in completing my research proposal.

I would also like to express my gratitude to my colleagues and also fellow

friend from UTeM for all their help and support in the completion of the research

proposal and also this report. To all people who had contributed Thank you and god

bless everyone for all your support and I will always keep in mind all the help that

has been given to me and the kindness that has been shown to me. Thank you.

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ABSTRACT

This study aimed to investigate the psychological factors that influence the decision-

making process among consumers in purchasing goods at two supermarkets in the

supermarket Tesco Peringgit Jaya and Aeon Bandaraya. A total of 100 male and

female users responded to a survey consisting of Malays, Chinese and Indians.

Simple random sampling method was used for the selection of the sample. The main

objective of this study was to investigate whether psychological factors that influence

decision making in buying goods in the supermarket two. In addition, this study will

also look at the psychological factors that most influence the decision making

process of consumers in the two supermarkets. In this study the researcher use the

questionnaire as the main instrument for obtaining data in this study. Pearson

correlation analysis was used to find the relationship between the two variables, and

multiple regression analysis were used to study the psychological factors that most

influence purchase decisions. Psychological factors are found to have any significant

difference to the making purchasing decisions. The psychological factors that

dominantly affects purchasing decisions making process among consumer at Tesco is

Perception meanwhile, the psychological factors that dominantly affects purchasing

decisions making process among consumer at Aeon is Learning.

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ABSTRAK

Kajian ini bertujuan untuk mengkaji psikologi faktor yang mempengaruhi proses

membuat keputusan dikalangan pengguna dalam membeli barangan di dua buah

pasaraya di Melaka iaitu pasaraya Tesco di Peringgit Jaya dan Aeon Bandaraya.

Seramai 100 orang pengguna lelaki dan perempuan telah dipilih sebagai responden

kajian yang terdiri daripada Melayu, Cina dan India. Kaedah persampelan rawak

mudah telah digunakan untuk pemilihan sampel kajian. Objektif utama kajian ini

adalah untuk mengkaji apakah faktor-faktor psikologi yang mempengaruhi

pembuatan keputusan dalam membeli barangan di dua buah pasaraya tersebut.

Disamping itu kajian ini juga turut melihat faktor psikologi yang paling dominan

mempengaruhi proses pembuatan keputusan di kalangan pengguna di dua buah

pasaraya tersebut. Dalam kajian ini saya menggunakan kaedah soal selidik sebagai

instrument utama bagi mendapatkan data dalam kajian ini. Analisis Korelasi

Pearson digunakan untuk mencari hubungan antara kedua-dua pembolehubah,

manakala analisis regresi berganda digunakan untuk mengkaji Faktor Psikologi

yang paling mempengaruhi pembuatan keputusan pembelian. Setiap Faktor

Psikologi didapati mempunyai perbezaan yang signifikan dengan pembuatan

keputusan pembelian. Faktor Psikologi iaitu Persepsi merupakan faktor psikologi

yang paling mempengaruhi pengguna Tesco manakala Pembelajaran pula

merupakan faktor psikologi yang paling mempengaruhi pengguna Aeon dalam

pembuatan keputusan pembelian.

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TABLE OF CONTENT

CHAPTER CONTENT PAGE

ACKNOWLEDGEMENT v

ABSTRACT vi

TABLE OF CONTENT viii

LIST OF TABLE xiv

LIST OF FIGURE xvii

I INTRODUCTION

1.1 Background of Study 1

1.2 Problem Statement 4

1.3 Research Questions 6

1.4 Research Objectives 7

1.5 Hypothesis 7

1.6 Scope, Limitation and Key Assumption

1.6.1 Scope of Study 8

1.6.2 Limitation of the Study 9

1.6.3 Key Assumption of the Study 9

1.7 Significance of the Research

1.7.1 Significance to the Scientific

Treasure 9

1.7.2 Significance to the Society 10

1.7.3 Significance to the Hypermarket 10

1.8 Summary 11

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II LITERATURE REVIEW

2.0 Introduction 12

2.1 Definition of Conceptual and Operational

2.1.1 Consumer 16

2.1.2 Consumer Psychology 18

2.1.3 Decision Making Process 18

2.1.4 Consumer Decision Making

Process 20

2.1.5 Consumer Psychological Factor 27

2.1.6 Consumer Psychological

Relationship with Purchasing

Decision 33

2.1.7 Consumer Behaviors 34

2.2 Past Research 36

2.3 Theoretical Framework 37

2.4 Summary 38

III RESEARCH METHODOLOGY

3.0 Introduction 39

3.1 Research Design 40

3.2 Research Location 41

3.3 Population and Sample 41

3.4 Operational Defiinition 44

3.5 Research Instrument

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3.5.1 Questionnaire 44

3.5.1.1 Screening 46

3.5.1.2 Section A:

Demographic Information 46

3.5.1.3 Section B:

Psychological Factor 46

3.6 Primary and Secondary Data 47

3.7 Research Strategy

3.7.1 Primary Data Collection 48

3.8 Time Horizon 48

3.9 Pilot Test 48

3.10 Method of Data Analysis 49

3.10.1 Regression Analysis 51

3.10.2 Reliability Statistics 51

3.10.3 T-Test 52

3.11 Summary 52

IV RESULT AND ANALYSIS

4.0 Introduction 53

4.1 Analysis of Demographic Information

4.1.1 Screening 54

4.1.2 Gender 56

4.1.3 Age 58

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4.1.4 Race 60

4.1.5 Marital Status 61

4.1.6 Education 63

4.1.7 Occupation 65

4.1.8 Income Per Month 67

4.1.9 Family Dependent 69

4.1.10 Shopping Frequency 71

4.1.11 Estimated Family Expenses 73

4.2 Objective Analysis 1 75

4.3 Objective Analysis 2

4.3.1 Psychological Factor that Influence

the Decision Making Process based

on Motivation 80



on Perception 81



on Beliefs and Attitudes 83



on Learning 84

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4.4 Objectives Analysis 3

4.4.1 To Examine Psychological Factor

Dominantly Affect Purchasing Decision

Making Process among Tesco Consumer 87

4.4.2 To Examine Psychological Factor

Dominantly Affect Purchasing Decision

Making Process among Aeon Consumer 90

4.5 Conclusion 93

V DISCUSSION, RECOMMENDATION

AND CONCLUSION

5.0 Introduction 94

5.1 Discussion


The Decision Making Process among

Consumer Tesco and Aeon 95

5.1.2 Differences Psychological factor in

terms of the style of decision-making

consumers Tesco and Aeon based

motivation 96

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Perception 98




Beliefs and Attitudes 99




Learning 101

5.2 Implications 102

5.3 Recommendations 103

5.4 Conclusion 105

REFERENCES 106

APPENDIX 112

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LIST OF TABLE

TABLE CONTENT PAGE

1.1 The Number of Respondent at Aeon 42

1.2 The number of Respondent at Tesco 43

1.3 The Total number of Respondent 43

1.4 Construct the Questionnaire 46

1.5 Strength of the Correlation Coefficient 51

1.6 Reliability of Variable 52

1.7 Recognition the Tesco product 55

1.8 Purchasing the Tesco Product 56

1.9 Recognition the Aeon product 56

2.0 Purchasing the Aeon product 57

2.1 Distribution of Respondents by Gender of

Tesco consumer 57

2.2 Distribution of Respondents by Gender of Aeon

Consumer 58

2.3 Distribution of respondent by age of Tesco consumer 59

2.4 Distribution of respondent by age of Aeon consumer 60

2.5 Distribution of respondent by race of Tesco consumer 61

2.6 Distribution of respondent by race of Aeon consumer 61

2.7 Distribution of respondent by status of Tesco Consumer 62

2.8 Distribution of respondent by status of Aeon consumer 63

2.9 Distribution of respondent by education of Tesco

Consumer 64

3.0 Distribution of respondent by education of Aeon

Consumer 64

3.1 Distribution of respondent by occupation of Tesco

Consumer 65

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3.2 Distribution of respondent by occupation of Aeon

Consumer 66

3.3 Distribution of respondent by income per month of Tesco

consumer 67

3.4 Distribution of respondent by income per month of Aeon

consumer 68

3.5 Distribution of respondent by family respondent of Tesco

consumer 69

3.6 Distribution of respondent by family respondent of Aeon

Consumer 70

3.7 Distribution of respondent by shopping frequency of Tesco

Consumer 71

3.8 Distribution of respondent by shopping frequency of Aeon

Consumer 72

3.9 Distribution of respondent by estimated monthly expenses

of Tesco consumer 73

4.0 Distribution of respondent by estimated monthly expenses

of Aeon consumer 74

4.1 Distribution of Tesco respondent by the

Psychological Factor 75

4.2 Distribution of Aeon respondent by the Psychological

Factor 77

4.3 The Psychological factors that influence the decision

making in the purchase of goods among Tesco and Aeon

consumers 79

4.4 Psychological Factor that influenced the decision

making process among consumer Tesco and Aeon

based on Motivation. 80



based on Perception. 82


making process among consumer Tesco and Aeon based

on Perception. 83

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based on learning. 85

4.8 Result on the hypothesis test of Psychological

Factors toward the consumer purchasing behavior

at Tesco and Aeon 86

4.9 The Psychological factors that dominantly affect

the purchasing decisions making process among

consumer at Tesco 88

5.0 The Psychological factors that dominantly affect

the purchasing decisions making process among

consumer at Aeon 91

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LIST OF FIGURE

FIGURE CONTENT PAGE

1.1 Model Comparison Decision Making Process

In Consumer Behavior 20

1.2 The Process of Consumer Decision Making

Approach 21

1.3 Stage of Consumer Decision Making Process 23

1.4 Abraham Maslow Theory of Motivation 27

1.5 The basic Model of Consumer Behavior 34

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CHAPTER I

INTRODUCTION

1.1 Background of Study

In this era of globalization, people are experiencing changes increasingly

complex both in terms of socio-economic or socio-cultural aspects. These changes lead

to a change in lifestyle impact of technological developments in the market makes a

country more complex by the day. Consequently, individuals within a society find it

increasingly difficult to make a choice or decision in buying their daily needs. Various

options provide benefits consumers offered by marketers or companies in a variety of

forms of business and markets, so that consumers cannot distinguish between options

that really can benefit them.

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A reaction to changes in pricing, advertising and marketing method involves

changing consumer preferences when prices fluctuate. Consumer groups are also

sensitive to changes that involves the interests of choose and buy. A person is

recognized as a consumer when he made the decision to buy a particular product. The

consumer is plays an important role in the economic development of the country.

According to Muhammad Faisal (2001), consumers make every day shopping and buy

from the seller and then use the money to buy other things. Hence, it can move the

economy in a positive way if directly the consumers spending to revive the economy of

our country. This does not mean consumers should shop and buy things arbitrarily.

Therefore, consumers should practice discretion in making spending. Consumers will

also make decisions and considerations before choosing any goods. According to Engel

(1978) the importance of consumers activities that affect their election observation and

market behavior as a relationship with the seller, the media and the influence of

advertising, information and decision making.

According to Lamb (2009) consumer behavior also explains how consumers

make purchase decisions and how they use and dispose of purchasing goods or services,

so we can understand the importance of consumer behavior for the marketer and as an

important process in the purchase decision process. A marketers need to identify which

consumers they are to be able to sell their products, generate revenue and profits but also

can satisfy them for future purposes such as market share through recognition, and only

once identified their consumer behavior can be achieved.

Apart from that, consumers are human beings who have a rational mind that it

makes decisions making is beneficial to him. A consumer tries to satisfy itself to buy a

certain quantity of product output in and have a specific behavior. From the various

definitions given about consumer behavior, we can conclude that someone would use a

product that was introduced, but if it does not fit, then they will stop using it and will

look for other products. By such things there every consumers has their own favorite

products and after like using these products then they will remain loyal to use the

product. In addition, consumers can also be classified as long as anyone has a job and

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their own income and the income that they can make a decision to choose properly by

using basing their purchasing power compared with users who have to rely on other

financial resources to make a purchase.

Consumer decision-making process begins with the identification of needs, when

the stimulus and awareness for the necessity of far less satisfied. If additional

information is needed to make the purchase decision process, consumers may be

involved in an internal or external information search. Consumers then assess additional

information and to create guidelines purchases. Finally, a decision will be made.

The consumer buying process is influenced by expectations pre-purchase, search

the pre-purchased information and general level of self-confidence of consumers. Make

the decision making process, the consumer fall into three broad categories. Firstly,

consumer will be exhibiting behavioral responses to routine frequently purchased items

with a low cost, requires little effort decision making, behavioral responses routine

typically characterized by brand loyalty. Second, its consumers are involved in decision-

making that is limited to occasional purchases or for an unknown brand in the product

category known and that these three are consumer decisions when making purchases

decision is far less known, expensive or rarely purchased.

According to Solomon Bamossy (2006) consumer behavior is the study of the

process involved when individuals or group select, purchase, use or dispose of product,

service, idea or experience to satisfy need and desire. By doing so, a reaction to price

changes, advertising and marketing method involves changing consumer preferences.

Consumers groups including those that are sensitive to changes involving selecting and

buying.

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1.2 Problem Statement

This study focuses on the psychological factors that influence the decision-

making process in the selection of good among consumers and to examine which

psychological factors that dominantly affect purchasing decisions making process based

on motivation, perception, belief & attitudes and learning of the consumers in Tesco and

Aeon Malacca. The first problem is consumer doesn’t know which psychological factor

that dominantly affecting them while purchasing the Tesco and Aeon product. The

second problem is the lack of psychological factor will make them failing to purchase

the required goods. In the psychological aspect, consumer really cares about their

satisfaction in terms of the selection of items. During the process of making a decision to

purchase goods among consumers, there are many factors that will affect it.

Identifying specific personality traits that explain differences in consumers’

purchase, use, and disposition behavior mention by Hoyer (2010). Consumers have

several needs which have to be observed and identified in order for the business to meet

its consumer’s behavior. Consumer's behaviors are influenced during their purchasing

process by four specific characteristics, such as cultural, social, personal and

psychological factors, this is also seen mentioned by Armstrong (2009), “Consumer

purchases are influenced strongly by cultural, social, personal and psychological

characteristics, marketers cannot control such factors, but they must take them into

account”. These four factors will be the key aspects towards what influences a

consumer’s behavior when purchasing a product. Another influence which would affect

this consumer’s behavior would be his personal characteristics such as his personal

lifestyle, age and occupation, which can be also seen expressed by Kotler (2010). In this

research, the researcher only focus on the psychological factors that influence the

decision making in selecting goods among consumers at the two hypermarkets which is

Tesco and Aeon Malacca.

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The selection process is one of the procedures in purchasing activity by

comparing something with something else to make a decision. Selection ethical decision

did not voluntarily taken between two alternative labeled as good and bad.

Psychologists have said that one of the strongest variables in determining the

strength of a habit is the number of confirmations received by an individual. According

to the Law of Effect Thorndike, when a matter is followed by the conditions are

satisfied, the power will increase and the possibility of that is repeated is great. But when

something is accompanied by unfavorable conditions and soil strength will decline. An

organism tends to repeat something that never satisfies him express by Berkman and

Gilson (1981). This law can be attributed to the habit of buying things. When first

purchased goods can satisfy the consumers the possibility or probability of re-election

article is great.

Customers in making decisions about alternative products would consider social

factors, personal, cultural and psychological stated by Kotler (2008). The main factors

that into consideration in their purchasing decisions of customers are psychological

factors include motivation, perception, belief and attitudes and learning. To analyze the

behavior of consumers would be more successful if researchers can understand aspects

of human psychology overall strength of cultural factors, economic principles and

marketing strategies. As is often the behavior of customers affected by psychological

factors that directly or indirectly affects consumer behavior in terms of the purchasing

decision. The ability to analyze customer purchasing decisions attitude means success in

soul-searching our customers to meet their needs.

According to Stephen P. Robbins (2008) the psychology may be defined as the

science that seeks to measure, explain, and sometimes change the behavior of humans

and other creatures. Psychological factor is the most fundamental factor in the individual

that will affect the choices a person in purchasing. The components of the psychological

factors based on motivation, perception, belief and attitude and learning. A boost in

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define as a strong internal stimuli that urge towards an action.

Psychological factors are among the factors that arise from within ourselves,

which influences customer purchasing decisions. Psychological factors consumers in

making purchasing decisions consist of motivation, perception, attitudes and beliefs and

learning in relation to the purchase of a product. Therefore, the researcher sought to

analyze psychological factors that influencing purchasing decisions and examine which

psychological factor that dominantly affect the purchasing decision process.

1.3 Research Question

Accordingly, this study attempts to look at the differences of psychological

factors that influence the selection of items and to examine which psychological factor

that dominantly affect the purchasing decision making process based on motivation,

perception, beliefs and attitudes and learning. Based on the background of the above

problems, the study is to answer two key questions such as the following:

1. What are the differences of psychological factors that influence the decision making

in selecting goods among consumers at Tesco and Aeon?

2. Which psychological factors that dominantly affects purchasing decisions making

process based on motivation, perception, beliefs and attitudes and learning of the

consumers.

decision making process in consumer purchasing behavior

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